The Benefits of a Strong Culture in an Organization

Subject: Organizational Management
Pages: 11
Words: 3037
Reading time:
11 min
Study level: PhD

Executive summary

When an organization is formed, there is a need for a culture that is understandable and convincing not only to customers but also to employees. Nevertheless, the formed culture should be maintained by ensuring that it manifests itself positively to both the internal and external environment. However, culture needs to be flexible such that it can change with time, a task that requires a lot of effort as employees have already embraced the current culture. Therefore, the management should be keen to determine the right time for a change. This research emphasizes the benefits of a strong culture in an organization.

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Khan’s article explains further the four components of organizational culture, which include support orientation that focuses on employees’ needs, innovation associated with new ideas aimed at positively benefiting the organization and its staff. Coordination involves planning, controlling, and organizing in an attempt to blend activities and enhance communication. Finally, rules are created to ensure that tasks are accomplished on time and that the functions of the organization are running systematically. Traits of organizational culture are discussed in-depth, as well as involvement, consistency, adaptability, and the organization’s mission. It is rather clear that culture is a part of an organization and it sometimes defines an organization, such that, when a customer diagnoses an organization culture, he gets a clear picture of the company.

Introduction

The beliefs, norms, and values of an organization represent the character of the organization. When employees are trained on how to react to a certain situation, they embrace the organization’s culture, which becomes their identity. However, according to Khan, et al. (2010, p.55), despite organization culture involving organizational activities, it affects performance and efficiency, such that, favorable culture can improve organizational performance and lead to a competitive organization. Therefore, managers can further examine organizational culture to improve performance.

Mcfarlin (2002) further explains that, when organizational values are widely shared among employees, the company stands to benefit. In addition, strong organizational culture results in an increase in stock prices, growth in income, and high returns on investments, whilst shared values contribute to improved employee behavior. A strong culture contributes to employees’ perspectives, such that, when they embrace corporate values, it is difficult for them to replace these values.

Nevertheless, organizational culture can be either strong or weak; whereby, a strong organizational culture consists of a majority of employees who share the same beliefs and values, therefore contributing to efficiency. A strong culture is considered valid, hence passed on to new employees as a norm, since culture can only be achieved when people share identity and mission. Nevertheless, culture begins with a leader in the process of forming a group or organization.

Zuckeiman (2002, p. 158) further explains that organizations with strong cultures tend to outweigh their competitors. In addition, when the organizational values are clear and accepted, coordination of employees is easier and the relationship between goal and behavior is further enhanced. Whilst any negative behavior is easily identified and corrected fast, thereby improving an organization’s performance. For an organization to achieve reliable performance it must have a strong culture, as such performance contributes to quick planning and a fast decision-making process (Zuckeiman, 2002 p. 159).

Benefits of a strong, cohesive organizational culture

Khan, et al. (2010 p63) emphasize that organizational culture is related to practices associated with the workplace, norms, and values. Here, norms symbolize the beliefs of members in terms of behavior, whilst values indicate a member’s belief on what is worth practicing. Work practices involve sharing knowledge and information with colleagues. In addition, an organization plays a vital role in the employee’s wellbeing; it provides training to its employees as a form of support strategy in conjunction with their culture.

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An organization can become agile and still maintains a strong culture. Boisnier & Chatman (2002, p.2) explain how a strong organizational culture can lead to advantages for the organization. The achievement of a sustainable culture should however not be at the expense of environmental concern, since such a case would be detrimental to the survival of the organization. He further explains that a strong organizational culture exists when members agree to the organizational values and norms. Nevertheless, an organization with a strong culture tends to create clear values, which are respected by the members.

In addition, a strong culture is important in providing opportunities for pursuing organizational objectives as well as improving productivity. This is due to the member’s commitment and enthusiasm; however, these cultures could also entail the cost strategy and customer service as a measure towards maximizing profits. A perfect example is Southern Airlines’ ability to offer low-cost services and maintain quality customer service, whilst still making profits (Boisnier & Chatman, 2002, p.4). moreover, “strong cultures may enhance short-term success, but limit long term organizational performance; however, they may contribute to long term failure by preventing organizations from adapting to changing contingencies” (Boisnier & Chatman, 2002, p. 4).

A study conducted on 200 firms and their cultures revealed that strong cultures were most successful in stable environments compared to dynamic environments. In addition, organizations with strong cultures may be “limited change because members are especially resistant to changing those strongly held and widely shared values” (Khan, et al, 2010). Khan, et al. (2010, p. 74) add that organizational cultures vary, however, they are accompanied by four pillars of an organization – support, rules, innovation, and coordination – as they ensure an organization survives and benefits.

An organization should ensure that it gives its support to the staff in terms of training and counseling among others. However, these support services vary from one organization to the other. Employees suffer from generalized problems, both family and work-related; therefore, employees’ needs vary. Nevertheless, if employees are not comfortable at their place of work, the turnover rate will be high. Innovation is considered a tool towards competitive advantage since it includes new ideas and outstanding performance. In addition, it entails sharing knowledge and information freely, hence encouraging new ideas, and risk-taking.

Secondly, Coordination entails the merging of efforts in an attempt to attain specific objectives. It can be achieved via planning, controlling, organizing, and actuating. Different departments need to communicate and enhance coordination in an attempt to avoid conflicts, but boost sharing of information and working on projects through teamwork. Nevertheless, the organizational structure is also an important element of coordination such that communication becomes effective if the organization structure is flexible.

Finally, rules are vital for any organization as they ensure that tasks are performed at the required time in the required way. Nevertheless, employees tend to emulate their managers, such that, if managers follow rules, their employees will imitate their behavior of complying with the organizational standards (Khan, et al., 2010, p. 69). According to Enz (2005, p. 68), a strong culture incorporates informal rules that indicate the expected behavior of people; however, this culture enables employees to develop a good feeling of their tasks, hence motivating them to even work harder.

The author further emphasizes that a cohesive culture does not guarantee long-term performance; however, it affects performance. Here, organizations are able to grow rapidly but may decline in terms of profitability. However, when customers are supportive of the organizational culture, they are still customers even when times are hard for the organization. Nevertheless, strong cultures are resistant to change due to their confidence in their culture.

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In addition, a strong culture may act as a self-policing force, such that, every member is aware of what is expected of him/her as well as what are is unacceptable. The author further adds that culture mainly comprises people as opposed to equipment, products, and services. Therefore, a positive culture minds its customers. According to Mobley, et al. (2006), a strong organizational culture can be a source of motivation and commitment.

The intensity of common beliefs makes it “easier to draw consensus among employees, to build a focus on important goals and objectives, to reduce potential conflicts, to cultivate a learning environment, and to lower staff turnover” (Mobley, et al, 2006). For a culture to be effective, it needs to be unique, with the ability to be understood clearly and unify all stakeholders in the organization. Moreover, the management needs to motivate employees in performing their functions rather than coercing them to do so, as the latter can lead to a decline in productivity. Therefore, it is easier for employees to identify themselves with their organization.

A strong organizational culture should be desirable, flexible, and stable in its vision, mission, and values. However, it should also be satisfactory to customers, the operating environment, and also to the employees. The authors further emphasize four cultural traits that influence organizations’ performance. They include mission, adaptability, involvement, and consistency. Involvement involves developing employees’ capabilities in responsibilities, thus engaging them in the organization’s developments. As a result, employees will feel involved in the organization, thus contributing to their motivation.

Empowerment should be a major concern for managers, such that, they should ensure that their employees are empowered with responsibilities such that they are capable of developing a sense of ownership and initiative. Involvement also encompasses teamwork and capability development, whereby, the skills of employees are developed so that they can stay competitive. Secondly, consistency determines whether an organization has a strong culture, via core values whereby an organization is required to have shared values, yielding to a sense of identity. This is in addition to the ability of leaders to reconcile fast and agree especially on critical issues.

Thirdly, adaptability focuses on the ability to “adapt quickly to the signals from the external environment, including customers and the marketplace” (Mobley, et al, 2006). Risk-taking is also vital to an organization, such that, it should develop a culture of adapting to change as a way of developing and also learning. The ability for an organization to focus on customers is very important, such that, it is able to meet their needs and also anticipate their future needs. An organization is able to gain customer loyalty, hence guaranteed returns.

Finally, an organization with a strong culture has a mission that guides it through the identification of future dangers and balancing with available strategic and action plans. A mission guides employee to a common goal and encompasses a strategic direction, which entails goals and objectives (Mobley, et al, 2006). A healthy organizational culture requires reinforcement through daily activities such as fostering communication of the organization’s values.

Nevertheless, organizational culture has proven to be important over the years, especially due to globalization, which has resulted in increased competition. Evidence shows that most successful companies like Southwest Airlines and Wal-Mart among others have unique marketing strategies inclusive of a strong culture, which contributes to their leadership in the market.

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Mechanisms of managing organization culture

For a culture to be well managed and even changed with time, several mechanisms are needed. First, strategic planning is necessary for an effective culture. Secondly, an organization should ensure there is consistency of culture with the organizational missions, processes, strategies, and goals. There should be a creation of a formal statement that presents the organization’s values. The establishment of incentives and performance measurement is necessary. In addition, the detection of errors and accountability systems are necessary. Organizational practices need to be enhanced such as training, coaching, and mentoring, among others. Nevertheless, for an organization to be successful, its culture must be proactive, have the ability to influence and manage the environment, and it should also be pragmatic. The organization should be well focused on the future and oriented to the future as well. It should also be capable of embracing diversity and uniformity. An organization should also be able to relate well to both the internal and external environment. Moreover, “a cohesive culture must be team-oriented, knowledge-oriented, and alliance and partnership-oriented “(Baker, 2002, p. 9).

Changes that need to be implemented by management to this workplace

BSG is faced with several problems among them decreased profits, stiff competition, and a declining economy. In addition, there is a lack of cohesion among employees, lack of job satisfaction and commitment, low levels of trust between management and the employees. Therefore, poor teamwork is evident and employee turnover is rising. According to Champoux (2010, p.83), for an organization to have a competitive advantage, it must acquire a rare, valuable, and non- imitable culture.

The rarity quality gives culture uniqueness among its competitors; therefore, a cohesive culture is a key to effective performance. Therefore, for BSG to maintain its market share, it should ensure that it attain a competitive advantage, in terms of its goods and services and their price. Therefore, the organization should adopt a marketing strategy that will contribute towards a competitive advantage. Nevertheless, BSG is faced with problems that have compromised its performance and employee relationships.

First, BSG needs to solve its problems by establishing a strong cohesive culture. Cohesiveness among employees is very important, as it increases teamwork and cooperation among them. Therefore, the organization should ensure that there are clear set objectives that encourage cohesiveness. In addition, the management focuses on the job training on communication, leadership, and other important skills at the workplace. Employee satisfaction is important not only to employees but also to the organization. When employees are satisfied, their level of performance is high and the organization’s productivity rises too.

Employee satisfaction may vary from benefits, training, working environment, and job enrichment to incentives among others. When employees feel satisfied in their place of work, turnover becomes a history. According to James Waters, the managing director of BSG, the organization’s strong culture seems to be weighing the company down. Therefore, the management should adopt a culture that is flexible to change and is consistent with the organization’s mission and objectives; one that will ensure the organization maintains reliability, with the traits of involvement, consistency, adaptability, and mission (Champoux, 2010, p. 83).

Implementation of changes

According to Harter, Schmidt & Keyes (2002, p.2), employees spend more time at the workplace compared to other places. Therefore, satisfaction is vital for employees, which ranges from the nature of work to perform. Therefore, employers should be willing to provide benefits to employees to retain them. The author further adds that the well-being of employees should be an employer’s priority, as employees’ productivity affects the organization. Satisfied employees are more cooperative, punctual, and rarely absent from work.

Adam’s equity theory “calls for a fair balance to be struck between an employee’s inputs, for instance, hard work and an employee’s output” (Pahl, Hinze & Richter, 2009, p. 7). A fair balance between inputs and outputs contributes to increased organization’s productivity and motivated employees. In addition, the management should ensure that their hard work rhymes with their outputs. When an employee is treated with just, there is a high possibility that he will yield a positive outcome in terms of performance, and low turnover rates (Pahl, Hinze & Richter, 2009, p. 7).

According to Champoux (2010, p. 83), a strong culture involves employees in the organization’s activities such as decision-making. Vinton (1987, P.65) emphasizes that delegation is an important tool in developing their skills, which results in job satisfaction and commitment, which is a need in BSG company. For BSG to attain a competitive advantage over its competitors there is a need for new marketing strategies, which are hardly imitable to increase the company’s existing market share. Product or service differentiation involves the uniqueness of a product or service in a way that cannot be imitated by other competitors. This strategy is accompanied by value addition, thus standing out in terms of rarity.

The rarity of a product or service of a company contributes to the value of the organization; hence sales are deemed to increase by acquiring loyal customers (Schermerhorn, 2009, p. 147).

The second strategy may involve cost leadership that entails operating at the lowest cost to attract customers. The low prices act as a challenge for the competitors, as they cannot match these prices (Schermerhorn, 2009, p. 147). Stiff competition can be a hindrance to making profits; therefore, it is wise to do an organization to adopt strategies that are not easily imitable to protect its market share.

Training is important in any organization, especially on wanting issues such as communication and teamwork, therefore ensuring that employees work in one accord towards the organizational goals and objectives. According to Khan (2010, p.74), an organization should ensure that it gives its support to the staff in terms of training, especially in crucial areas such as communication and the importance of teamwork. When employees attain such skills, cooperation among them will be much easier.

It is rather clear that an organization’s culture should be changed in an attempt to add value to the organization. According to Rizescu (2011, p. 78), employees are the determinants of organizational culture, such that, their training and temperament indicate the organization’s staff value system. In addition, the size of the organization determines the diversification of the organization’s culture. Leadership is also an important aspect of organizational culture, as the form of leadership represents the culture of the organization.

Organizational culture can lead to its growth or stagnation; however, changing of culture like in this case requires the task of changing employee’s attitudes regarding the new culture. Therefore, the management should inform staff on the culture change, thereby guiding them through the changes until they are confident of the new culture. In the case of BSG, the organization should base its new culture on customer priorities as well as its employees. It is however evident that change can prove to be very difficult for employees, however, if management assists employees in adapting to change and further involving them in the decision-making, they will embrace change fast.

Conclusion

Strong Organization culture is vital to the organization as it holds rich values, which meet the stakeholders, customers, and employees’ needs. A strong culture has a high return on sales, as there is the presence of participatory decision-making. The clear goals and objectives present in these cultures enable employees to perform well in their tasks. Research proves that a stable culture consists of four traits, which include employee involvement in decision-making, consistency, adaptability, which entail an organization’s capability to respond to changes, and the organization’s mission, which keeps the employee focused on the value of the organization.

References

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